DBS Group saw net profit rise roughly in line with expectations for the first quarter as growth in income from fees at the banking and financial services company improved, even while its non-performing loan rate held steady from the December quarter.
Net profit rose 1 per cent year on year to S$1.21bn ($866.6m), in line with a median estimate from analysts surveyed by Bloomberg and marking a climb of 33 per cent from the previous quarter.
Total income rose 1 per cent year on year to S$2.886bn. DBS credited the rise to growth in non-interest income, particularly a 16 per cent rise from net fee and commission income.
Net interest income was down marginally from a year earlier, falling S$2m to S$1.833bn, although that was up S$5m from the previous quarter. The company credited 7 per cent constant-currency growth in loans with offsetting the impact of softer Singapore dollar interest rates.The non-performing loan rate at DBS held at 1.4 per cent in the first quarter, unchanged from Q4 and up from 1 per cent in Q1 2016.
That pushed allowances to S$200m, up 18 per cent from S$170m a year earlier but down 57 per cent from the December quarter’s level of S$462m. As in Q4, DBS said a significant portion of allowances resulted from exposure to the struggling oil and gas support services sector.